Development finance calculator
This calculator estimates the full cost of a UK development finance facility. It models the day 1 land loan, staged build drawdowns, rolled-up interest during build and the sales or refinance period, plus lender fees. The total facility is capped at the lower of 90% of total costs (including finance) or 70% of GDV, in line with standard lender limits.
FD Commercial arranges development finance from £250,000. Broker fee up to 1% of the loan amount.
What this calculator models
Day 1 advance on land (up to 75% of purchase price). 100% of build costs and contingency drawn in equal monthly stages. Interest rolls up on the cumulative drawn balance throughout build and the sales or refinance period. Lender fees added at end of build. The committed facility (day 1 + build) is capped at the lower of 90% LTC or 70% GDV. These are lender limits on the principal, not the total debt.
Contingency is auto-set at 10% of build costs. If the requested facility exceeds lender caps, the day 1 advance is reduced first, then the build facility if necessary.
Minimum loan: £250,000. Broker fee up to 1% of loan amount.
UK Development Finance Calculator
Results update automatically. All figures are indicative estimates.
Indicative estimates only. Excludes VAT, sales fees, holding costs and lender-specific variations. Actual terms depend on lender, scheme type, developer experience and exit strategy. Broker fee up to 1% of loan amount applies to development finance. Speak to FD Commercial for accurate indicative terms before committing to a site.
How development finance is structured
Development finance is not a single advance. It is a facility drawn in stages, with interest calculated on the drawn balance at each point rather than the total facility from day one. This makes the cost significantly lower than a standard loan for the equivalent amount, because you are only paying interest on what has been drawn.
The day 1 advance covers the land purchase. Most lenders will advance up to 75% of the purchase price or land value on day one, with the remainder funded by the developer as equity. Build costs are then drawn monthly throughout the construction programme, with the lender typically funding 100% of agreed build costs. The build facility is released in stages against either a drawdown schedule or surveyor sign-off at each milestone.
Example: 4-unit residential development, Midlands
Land: £500,000. Day 1 loan at 65% requested (£325,000). Build costs: £700,000. Contingency: £70,000. Other costs: £48,000. GDV: £1,400,000. Rate: 0.85% per month. 12-month build, 6-month sales period. Lender fees: 2%.
The 70% GDV cap (£980,000) is the binding constraint. Day 1 advance is reduced from £325,000 to £162,000 so that day 1 (£162k) + build facility (£818k) = £980,000. Total interest: approximately £112,000. Lender fees: approximately £20,000. Total finance costs: approximately £132,000. Developer equity: approximately £338,000. LTC: 74%. LTGDV: 70%.
LTC and LTGDV: the two lender limits that matter
Lenders underwrite development finance against two metrics simultaneously. Loan-to-cost (LTC) measures the committed facility (day 1 + build draws) as a percentage of total project costs, excluding finance. Most lenders cap LTC at 90%, though many require lower thresholds for less experienced developers. Loan-to-GDV measures the same committed facility as a percentage of completed value. The standard cap is 70%, often lower for first-time developers or higher-risk schemes.
These caps determine how much the lender will commit. Interest and fees then accrue on top. The calculator applies both caps and uses whichever is more restrictive. If your inputs push the committed facility over either limit, the day 1 advance is reduced first, then the build facility if necessary.
According to the Department for Levelling Up, Housing and Communities, net additional dwellings in England reached 234,400 in 2022/23, of which the private enterprise sector delivered approximately 179,000. The majority of speculative residential development is financed through staged development finance facilities with rolled-up interest.
Source: DLUHC, Housing Supply: Net Additional Dwellings, England 2022/23 (gov.uk)The Bank of England base rate stood at 3.75% in April 2026, following reductions from the 5.25% peak reached in August 2023. Development finance lenders typically price at base rate plus 3 to 5 percentage points on a monthly rolled basis, resulting in all-in rates of approximately 0.70% to 0.95% per month for most residential schemes in 2026.
Source: Bank of England, Monetary Policy Committee decisionsAlso on mobile
Use this calculator and 3 more inside the FD Commercial app
Free on Google Play. No signup, no in-app purchases. Includes the Bridging Cost Analyser, Development Appraisal, BTL Stress Tester, and a Stamp Duty Calculator covering SDLT, LBTT and LTT.
Got a site under offer? Run the numbers here first, then speak to us. We know which lenders will work with your LTC and LTGDV position and what first-time developer restrictions apply. Broker fee up to 1% of loan amount.
Call 03300 100315Frequently asked questions
What are LTC and LTGDV caps and how do they limit my development finance?
Loan-to-cost (LTC) caps the committed facility (day 1 land loan plus the full build facility) at a percentage of total project costs, typically 90% for experienced developers. Loan-to-GDV caps the same committed facility at a percentage of completed value, typically 70%. Both apply simultaneously and the more restrictive limit determines how much the lender will advance. Interest and fees accrue on top of the committed facility and are not included in the cap calculation.
How does interest roll up on development finance?
Interest is not paid monthly. It accrues on the drawn balance and is added to the loan. On day 1 you pay interest on the land loan only. As build costs are drawn each month, interest accrues on the growing cumulative balance. By the end of the build term, interest is rolling on the full facility. During the sales or refinance period, interest continues to compound on the total outstanding balance. The loan is typically repaid in full from sales proceeds or a refinance at the end of the term.
What does the day 1 advance cover?
The day 1 advance funds the land or site purchase. Most lenders will advance up to 75% of the purchase price or land value on completion of the land acquisition. The remaining 25% is funded by the developer as equity. Some lenders will consider a higher day 1 advance where additional security is available or where the developer has a strong track record, but 75% is the standard market ceiling in 2026.
What build costs does development finance cover?
Development finance typically covers 100% of agreed construction costs, including a contingency allowance (normally 10% of build costs). Professional fees, planning costs, and CIL contributions may be included within the facility or funded separately as equity depending on the lender. The lender appoints a monitoring surveyor who certifies drawdown requests against work completed on site before releasing each stage of the build facility.
Can first-time developers access development finance?
Yes, though the criteria are tighter. First-time developers typically face lower LTC and LTGDV caps (often 85% LTC and 65% LTGDV rather than the standard limits), higher interest rates, and more intensive monitoring. Lenders want to see a credible project manager or main contractor with a track record even if the developer does not have one personally. Smaller schemes (under £1 million GDV) are easier to place with first-time developer criteria than larger sites.
What equity do I need for a development finance deal?
The equity requirement depends on the land price and which cap is more restrictive. At 75% day 1 LTV and 90% LTC, the land equity is 25% of the land value plus any project costs that the lender does not fund. In practice, most developers contribute between 10% and 30% of total project costs as equity, depending on the scheme, their track record, and the lender. Use this calculator to model your equity requirement before approaching lenders.
What is the minimum development finance loan at FD Commercial?
The minimum loan is £250,000. A broker fee of up to 1% of the loan amount applies to development finance arrangements. FD Commercial arranges development finance for residential, mixed-use, conversion, and commercial schemes across England, Scotland and Wales.
Your property may be repossessed if you do not keep up repayments on a mortgage or other loan secured against it. Rates and calculator results are indicative only and subject to individual lender assessment and underwriting. Results do not constitute a finance offer or lending commitment. FD Commercial arranges finance across England, Scotland and Wales. Minimum loan £250,000. Broker fee up to 1% of loan amount applies to development finance.